“Care for the Future”

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Measuring the Sustainability of Products

A&R Carton

“Care for the Future”

Author: Kor de Vries

Student number: s 1404237

E-mail: K.L.de.Vries@student.rug.nl

Study programme: University of Groningen

Faculty of Economics and Business MSc Technology Management

Company: A&R Carton BV

Supervisor: G.S.N. de Vries

University Supervisors: 1st Dr. Ir. I. ten Have MBA 2nd Dr. Ir. N.R. Faber

Place and date: Sneek, 21 April, 2009

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Preface

In front of you lies the final report that will mark the end of my student life. The report contains the master thesis that was written over a period of six months in order to graduate in Technology Management at the Rijksuniversiteit Groningen. I had a great time in Groningen and feel blessed to have enjoyed the privileges of being a MSc student. Many thanks to my friends with whom I shared many great moments and the experience of evolving from a first year high school boy to a graduate student.

I would like to thank a couple of people who helped me during the completion of the master thesis. First of all, I would like to thank Gerard de Vries, manager director of A&R Carton Sneek, who gave me the opportunity to graduate on the subject of sustainability. Also I would like to thank everybody else with A&R Carton who helped me with my project.

Furthermore, I would like to thank my first supervisor Ingrid ten Have. She gave important feedback to determine the structure of the thesis, especially in the beginning of the project.

Also thanks to Niels Faber, who was my second supervisor.

Finally, I would like to thank my family and especially my mother for providing a place to

live during the working days.

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Executive Summary

In this report, the sustainability of an A&R Carton Sneek product is assessed from a life cycle perspective. For that, the Life Cycle Assessment method is used. What is meant by life cycle is the extraction of raw materials through production, distribution, consumer use and final disposal. A life cycle perspective ensures that all activities in the supply chain are considered.

Possible non-sustainable practices anywhere in the supply chain are made visible.

Sustainability is operationalised into three pillars: social, environmental and economical impacts.

A complete environmental impact assessment was conducted for the Heineken USA 6-pack carton. The focus was on one impact category, Global Warming Potential (GWP

₁₀₀

) or carbon footprint. The possibility to assess the social impacts of a product life cycle is discussed in the theoretical part of this thesis. An actual social impact assessment was not conducted, as there are still too many uncertainties in the way this can be done. The economic aspect of sustainability was left out of the study for reasons concerning complexity.

From the environmental impact analysis, several conclusions could be made. One finding was that the recycled carton board stage had a large contribution to the carbon footprint. But with a life cycle perspective it was found that this stage had positive side effects on other stages in the life cycle. When these side effects were taken into account, recycled carton board contributed least to the GWP

₁₀₀

and was favored over virgin carton board. Also, the final disposal stage is a big contributor to the carbon footprint due to high percentages of cartons that are landfilled causing CH

4

emissions. The virgin carton board manufacturers and A&R Carton Sneek contribute around the same amount to the GWP

₁₀₀

. Although the carton board stage uses a lot of energy it uses high quantities of wood, a renewable resource, for generating the energy needed. This reduces their impact significantly. Within this study three different carton board suppliers of A&R Carton Sneek were included. The Brazilian company performed much worse compared to the Swedish companies. This is caused mainly by differences in efficiency and the way electricity is produced for the national grid.

Comparing the carbon footprint of the Heineken USA 6-pack with milk packages it can be concluded that the cartons are environmentally friendly. In the worse case the carbon footprint for the Heineken USA 6-pack is around 43 gr. CO

2

-eq., the milk packages had a carbon footprint of 150 gr. CO

₂

-eq. This gives some indication, although the products are not the same and the studies have different boundary settings.

To reduce the carbon footprint of the Heineken USA 6-pack even further it should produce the product from recycled carton board as much as possible. The remaining virgin carton board should then be made from the carton board supplier which contributes least to the GWP

₁₀₀

. Other ways to reduce the carbon footprint are: increasing use of renewable energy, minimize resource use, make processes more (energy) efficient, use other production techniques or change transport parameters such as transport mode, type or load factors.

Besides the results, an important contribution this research makes is the complete execution of

a Life Cycle Assessment. It can be used as an example for successful life cycle studies

containing difficult system boundary decisions and data sources. It can serve as a base to

which social and economic analysis can be added in the future.

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H2 Introduction 2.1 About the report

This report will deliver a scientific approach to map the sustainability of a company. The company for which this research has been conducted is A&R Carton. It is interesting for readers who would like to know more about the concept of sustainability and implementation of sustainability within their company. The report will assess the sustainability of a specific product with the help of an approach that is still in its infancy – Life Cycle Assessment. The report is extra interesting for companies in the carton industry like A&R Carton.

2.2 Sustainability

In today’s world “sustainability” is becoming more and more important. Besides the economic perspective, there is a need to consider more business aspects. An agreement on one single definition for sustainability is not available. The term sustainability, however, originally is used in the report “Our Common Future”, better known as the Brundtland Report (Klöpffer, 2005), which defines it as: “Sustainable development is development that meets the needs of the present without compromising the ability of future generations to meet their own needs.” Although this definition is clear, it gives no directions on how to make sustainability operational. Elkington (1997) did, however, and introduced the concept of the “Triple Bottom Line”; simultaneously addressing the social, environmental and the economic impacts of the company’s activities. This operationalization became the standard interpretation of sustainability (Klöpffer, 2005), used not only in scientific literature but also in important guidelines such as the Global Reporting Initiative (GRI) for reporting the sustainability of companies.

Figure 1. “Three bottom line” adopted from Hauschild et al. (2005)

The three aspects or pillars of sustainability have to be quantified separately so that a

valuation or weighing is possible under different political, social and regional aspects

(Klöpffer, 2005).

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The reason why sustainability has gained more attention is because of increasing evidence that the current way of doing business might have a dramatic influence on the environment. In 2007 the Intergovernmental Panel on Climate Change (IPCC) issued a report about the cause of the increasing amount of greenhouse gases (GHG) in the earth’s atmosphere and the impact thereof on natural and human systems. Observations of the increases in global average air and ocean temperatures, the widespread melting of snow and ice, and a rising global average sea level, it became evident that the warming of the climate system is unequivocal (IPCC, 2007).

In the same report it was concluded that most of the global average warming over the past 50 years is very likely due to anthropogenic GHG increases (IPCC, 2007)

To reduce human impacts the Kyoto protocol was signed with the goal of reducing greenhouse gas emissions by 5% over 2006-2012. New EU agreements are more ambitious and are in line with the growing concern about global warming. The EU committed itself to cut greenhouse gas emissions by 30% with respect to 1990 levels by 2020. It also made other first-world countries commit to making comparable reductions under a global agreement. To start transforming Europe into a highly energy-efficient, low-carbon economy, they committed to cutting emissions by at least 20% independently of what other countries decide to do.

The concerning reports and resulting policies set by the governments will reflect on how businesses are run. Also, businesses are no longer held responsible for their business activities alone, but also for the activities that result from those business activities. When serious misconduct is revealed it can harm a company’s reputation and consequently its profits.

Therefore it is becoming more important for companies to make their environmental life cycle performance transparent to their stakeholders to show that they are a good business company and a reliable business partner.

In the next section it will become clear that A&R Carton acknowledges this trend and the

importance of knowing the environmental impact caused by the company and other supply

chain companions.

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H3 Research Design 3.1 Problem definition

In the beginning of the diagnosis it became clear that sustainability is important to the managing director in Sneek and the top of the A&R Carton Group supports it. The Group sees sustainability as a key drive for competitiveness and a core value. Therefore A&R Carton is committed to managing its business in an environmentally responsible manner.

In the sustainability strategy document called Focus 24 a couple of goals are set. The most relevant goals for this research are:

• Map out where A&R Carton stands today, which environmental impact do we have and how are we communicating this to our customers;

• Formulate clear action on how we can improve ourself;

• Create a reference product CO

2

footprint (carbon footprint) against which we can compare all the products of the group.

Two activities were undertaken to make progress on the concept of sustainability. In 2007 A&R Carton delivered its first sustainability report in which social, economical and environmental issues were made explicit. In this same report the environmental policy states that all the work, investments and other activities should be based on a holistic perspective with the purpose of continuously reducing the environmental impact of packaging solutions and operations.

A second activity was the initiation of a Life Cycle Assessment (LCA) pilot study on premium packaging Cekacan (Grontmij, 2007). This study assessed the CO

2

-eq. emissions of producing one Cekacan package in a life cycle perspective. This means that CO

2

-eq.

emissions of the production of the raw materials were also included in the study. A holistic approach that underlines the environmental policy mentioned above.

A&R Carton Sneek is willing to take an active part in accomplishing the goals set in Focus 24. One reason for mapping the sustainability of the plant is that the carton board converting industry is believed to be a very sustainable business which can be useful for marketing purposes. Not showing the market how sustainable their products are is at any rate a missed opportunity. Also, Sneek is trying to be frontrunner when new business opportunities appear.

Evidence of this is the huge amount of effort invested in the implementation of World Class Manufacturing. This lean program was set up in order to improve production efficiency and effectiveness. Now Sneek has the honorable task to tell their colleagues how they are managing the project and what problems they faced.

Besides complying to the goals of the A&R Carton Group, A&R Carton Sneek is aiming for an FSC certificate. This is not mandatory. The certificate ensures that a production company gets its supplies from forests that are responsibly managed. For A&R Carton the certificate can give affirmation of the correctness of their internal processes. Of course it is also useful for marketing purposes as it reinforces their sustainability image.

This research will contribute to the Focus 24 sustainability goals. An environmental impact

analysis will be conducted that allows it to compete with other products by focusing on the

carbon footprint. For now it is sufficient to know that a carbon footprint is a measure for the

global warming potential of a product’s whole life cycle of extracting raw materials to

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production, use and final disposal expressed in CO

2

-eq. See section 5.1 for a more comprehensive explanation. This means that the impact on the environment will be viewed from a product system perspective.

As mentioned before, sustainability consists of three pillars. Addressing only the environmental impact would cover merely part of the concept. Therefore the social impact will also be included in the research. The third pillar, the economical impact, will not be included. This is because the financial situation is very volatile and dependant on many factors such as world economy, the price of carton board, etc. When the environmental and social impacts are clear the company can make decisions depending on the economical situation in which they are finding themselves to improve on sustainability. Furthermore, it would make the study too complex for this research period.

3.2 Research Goal

To measure and report the sustainability of A&R Carton Sneek from a product perspective that can be used for reference and as a guideline to take targeted actions to improve on sustainability.

Reference: It will inform the personnel and other stakeholders about the achievements of A&R Carton Sneek on sustainability from a product perspective. Besides the outcome it offers a clear method on how to measure the sustainability of a product in the carton business.

3.3 Research Question

How can the sustainability of a product system be assessed from a life cycle perspective and what can be done to improve on sustainability?

1. What is the carbon footprint of a specific product produced by A&R Carton Sneek and what can be done to reduce the carbon footprint?

a. What is a carbon footprint?

b. How can the carbon footprint be assessed?

c. What conclusions can be drawn from the carbon footprint study?

d. In which areas does A&R Carton have the potential to reduce the carbon footprint?

e. What are the achievements of competitors?

2. Which social impacts can be measured and how can this be related to a product system?

a. Which social impacts can be measured?

b. How can the social impacts of a product system be assessed?

c. What are the difficulties in conducting a social life cycle assessment?

3.4 Scope

- Describing the social and environmental aspects of sustainability, leaving the economic aspect outside the scope of the current study.

- The focus is on a specific product system.

- The global warming potential is the only ecological impact that will be assessed.

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- Information outside the plant is collected mainly through external literature and data sources. Data about the plant will be as specific as possible.

3.5 Conceptual model

Figure 1 Conceptual model

3.6 Method

First of all some information will be given about the company and the life cycle of the products it produces. This is to provide the reader with some background information and to get a more thorough understanding of the company. During each stage in the life cycle of cartons, findings of several studies will be cited that give insight in the potential contribution to the carbon footprint.

After this, the report will focus on answering the sub questions. The report will start with theory building which will explain what a carbon footprint is and how the carbon footprint can be assessed. A structural method is given to assess impacts caused by a product over its entire life cycle. The theory section will also answer sub question two which focuses on the social side of sustainability.

To be able to execute a sound case study research of assessing the carbon footprint of a product of A&R Carton scientific literature is consulted. Case studies on life cycle assessment will be used as data sources and guidelines to perform a life cycle assessment but also as references to check the final results of the study. Case studies were found useful when they assessed the global warming potential of parts of the life cycle that are studied in this report.

To find relevant case studies scientific journals were screened word combinations such as global warming potential, life cycle assessment, paper, forestry etc. Besides scientific literature, internet sources and reports were consulted.

When the theory is set the case study research will begin by following the method described

in the theory section. From the consulted literature a framework will be built that contains the

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processes which will be included in the study. The final results are evaluated and compared to other similar case studies. Also a benchmark will be done to put the results in a context.

Finally, a conclusion and recommendations will be given.

3.7 Relevance

The study is certainly also relevant for scientific reasons. Methods for mapping sustainability

of products are not yet fully developed and a common definition is still needed. Therefore

performing this study will contribute to the understanding of the practicability of mapping

sustainability of products. Also, by conducting this research insights are gained about the life

cycle of cartons and the impact it has on the global warming potential. The findings in this

study will be compared to other studies to evaluate the results. In this way, findings of

previous case studies can be reaffirmed or questioned.

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H4 Background

This section will provide the reader with some background information about A&R Carton.

After a short introduction about the Group the focus is on the plant in Sneek. It is explained what products are produced in Sneek and what is already done to reduce the environmental impact. After that an elaboration will follow about the life cycle of cartons.

4.1 The company

A&R Carton Sneek is a Dutch carton maker which is part of the A&R Carton Group. The multinational company has 1.850 employees, 14 production plants mainly located in Europe and sales offices in Europe, Asia, Africa and the United States. The company was founded in 2000 through the merging of Akerlund & Rausing carton business and FCP, both companies with traditions in the folding carton industry dating back to the early 1900s. A&R Carton specializes in value adding carton packaging solutions, which combines an innovative approach with vast experience in traditional consumer packaging.

¹

A&R Carton Sneek produces beer and beverage cartons for multiple customers. 55% of the beer and beverage packages produced by the Group are produced in Sneek. In total 104 employees are working in Sneek, of which 20 are staff members and 84 are blue collar employees. Sneek differentiates itself from other carton board converters by making cartons out of two pieces. This makes it possible for A&R Carton Sneek to produce their products at lower costs and compete in the market.

4.2 The product

A&R Carton makes multipacks ranging from 1x2 up to 4x6 units. The cartons can be delivered in different types: Wraparound, Fully enclosed, Top grid and Baskets. Some cartons have partitions inside (inserts) to separate the beer bottles. This is to prevent any damage to labels, or glass breakage during transport. The inserts are made of recycled carton board which costs less and is better for the environment compared to virgin fiber.

²

The virgin fiber carton board is used for the outside of the cartons (bodies). This material needs to be strong as they have to carry the load. For the carriers coated Kraft carton board is used. Cartons can be used only once and are disposed after usage.

Cartons are very environmental friendly as they consist almost entirely out of wooden products. Wood is a renewable raw material and can be re-cultivated. In Sweden it takes about 70 years for a tree to grow to full height (Korsnäs, 2007). However renewable doesn’t necessary mean sustainable. When the forests are managed in a sustainable way, which means no excessive use of fertilizers or logging rain forests etc., wooden products are the ultimate environmental friendly products.

1 http://www.ar-carton.com/

2 See section Recycled Paper for more information.

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Table 1 Declaration of content

Declaration of Content Input gr. Heineken USA 6-pack

% of

ingredients

Solids % of weight Heineken USA 6-pack

Virgin Carton Board 43,9 65,82% 43,9 68%

Recycled carton 20,21 30,30% 20,21 31%

Glue

(45 % solids)

1,04 1,56% 0,47 0,72%

Ink for rotogravure (65% are dilutes)

0,41 0,61% 0,26 0,41%

Varnish (30% solids)

0,49 0,73% 0,15 0,23%

Solvents:

Cmix (Ethanol,

ethylacetaat, 1-ethoxy-2- propanol)

0,65 0,97%

76% Ethanol 0,49

13% Ethylacetate 0,08

11% 1-ethoxy-2-propanol 0,07

Ethoxy propanol 0,01

Corrugated Board (trays+boxes)

2,54

Not included in the study

Cleaning material: Input gr/Heineken USA 6-pack

Ethyl Acetate 0,06

Quantity/1.000.000

Pellets 100

Wooden trays 100

Meters/1.000.000

String 1195

4.3 The environment

A&R Carton is ISO 9001:2000 and ISO 14001:2004 certified. These two standards provide a quality management system and an environmental management system respectively. Besides these internationally acknowledged systems other efforts are made to be more efficient, which as a consequence reduces the environmental impact.

- A research department is continuously trying to find new ways of making lighter cartons. A balance is sought between reducing material and functionality of the boxes.

Lighter cartons use less material which requires less trees and recycling effort in the

end of the chain. Also less waste is produced during the production of cartons.

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- The lighter cartons are thinner which allows more cartons to fit into package boxes.

This means that more cartons can be transported at once and less transport is needed.

- Recycled carton board is used for the inside of the cartons which are called inserts.

This recycled carton board is of less quality and strength compared to high quality carton board. Recycled carton board is used for functions that don’t contribute to the strength of the cartons. Using the recycled carton board instead of high quality carton board safes the environment.

- A&R Carton switched from wet strength carton board to non wet strength carton board. This was made possible by a change in the construction that ensured the same quality. Wet strength carton needs more energy to recycle than non wet strength carton - The air on the shop floor needs certain humidity. Therefore vaporized water is

injected. A new system is installed which uses less water and energy.

- An amount of heat produced by machines is guided through tubes to the shop floor to warm the facility.

- Control mechanism exists in offices for controlling the light. Lights will shift on and off on specified times which will also save energy.

- The shop floor is cooled down by using air from outside. Air from outside is cooled down by wet grills, which are located on the roof, and pumped down to the shop floor.

- To reduce travel, video conferences are held.

In the beginning of 2009, A&R Carton wants to become FSC certified. This means that

wooden products sold with the FSC certificate can be traced back all the way to the forests

where the trees are cut. These forests need to be responsibly managed and to adhere to the

principles and criteria set by the FSC.

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4.4 Life Cycle Cartons

In this section the life cycle in which A&R Carton is participating will be discussed. For each stage, a short description of the processes will be given. This short description will be complemented with findings of previous studies about the contribution of the global warming potential to each stage in the life cycle. The additional information is used for comparison with the final results of this study. In the picture below the life cycle of carton is represented.

The first step in the life cycle is forest management, including thinning, followed by pulp and paper making, carton board converting, recycling and/or final disposal.

Figure 2. The CO2 cycle adopted from CEPI (2007)

1 2 3

4 5

Converting Stage

Recycling Stage Final Disposal

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4.4.1. Forestry

Forestry is the first step in the supply chain. A study by Berg & Lindholm (2005) gives an overview of the different forestry processes. The study included the Swedish technical system for the production of round wood from forest seedling production, through to transportation of timber to the factory gate. This system includes operations such as seed production, the cultivation of forest seedlings, cutover clearing, soil scarification, natural or artificial regeneration, cleaning, logging operations and secondary haulage.

Figure 3 Production steps Forestry (Berg & Lindholm, 2005).

In life cycle studies (Dias et al. 2004; 2007) several ecological impacts of the production of printing and writing paper were assessed. In both studies forestry operations contributed a very small part to the global warming potential; around 2 % of the total.

4.4.2. Pulp & Carton Board Manufacturing

A&R Carton makes their cartons from “Kraft” carton board and recycled carton board.

“Kraft” carton board is produced from virgin fibers which are produced directly from trees.

Kraft carton board consists of multiple layers. Using different types of fibers for different

layers can give the carton board good stiffness, creasing, folding, and gluing properties. It also

assists paper density and thickness control (www.procarton.org). The carton board A&R

Carton uses has a top coated layer and a brown backside. In between, a multilayer of bleached

material can be inserted depending on the supplier.

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Figure 2. Composition of carton board adopted from Stora Enso (2007)

The pulp for making carton board can be produced in two different ways: mechanical pulping and chemical pulping. Mechanical pulping means that fiber separation is achieved by subjecting the wood to crushing/grinding pressure (www.procarton.org). Wood chips may be preheated with steam to assist the refining process in which case the pulp is known as “thermo mechanical pulp” or TMP, and when limited chemical pretreatment is also applied it is called

“chemi-thermo mechanical pulp” or CTMP (www.procarton.org).

In chemical pulping, debarked logs are chipped and treated with chemicals under heat and pressure. This process dissolves the resins which bind the fibers together in the wood. The Kraft, or Sulphate, process is by far the most widely used nowadays because of its ability to process all the commonly used species of wood and its high rate of chemical recovery (www.procarton.org).

The pulp yield in chemical pulping is typically lower than 50% and the remaining biomass, mainly black liquor, can be used to cover the energy demand of the pulping processes and even yield a surplus (Holmberg & Gustavsson, 2007). Mechanical pulping on the other hand requires large amounts of electricity, and since the yield can be as high as 95%, internal biomass residues cannot cover the demand (Holmberg & Gustavsson, 2007). Because fossil fuels are often used for the production of electricity mechanical pulping has a bigger impact on the global warming potential. Therefore chemical pulping is favored when the focus is on the global warming potential.

Furthermore, pulp and paper production can be separated or integrated in the same mill.

Integrated paper production is often beneficial since the pulp does not need to be dried.

Moreover, surplus heat in the pulping process can be used in the papermaking stage, where paper drying is the most energy-demanding process (Holmberg & Gustavsson, 2007). A&R Carton’s carton board suppliers all have integrated chemical pulp processes.

During the production of carton board a wide range of waste is produced. Both non-organic

(ash, dregs and grits) and organic (sludge) solid residues are generated during the different

stages in the production of bleached Kraft pulp (Nurmesniemi et al., 2006). However, this

huge amount of solid waste can be utilized for different purposes such as a neutralizing agent,

landscaping agent, hydraulic barrier material for landfills and as a soil enrichment agent

(Nurmesniemi et al., 2006). This effective way of utilizing the waste can significantly reduce

landfilling. It has been found (Nurmesniemi et al., (2006) to reduce landfilling between 1994

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and 2004 from 42990 to 6083 ton (expressed as wet weight). Another way to prevent solid waste to be landfilled is to incinerate the waste in order to generate energy. This would be the best solution if the waste can’t be reused for other purposes. However, the burning of solid waste has the disadvantage of producing a considerable amount of ash (Nurmesniemi, 2006).

According to (Dias et al., 2007) the pulp and paper board processes are the most important contributors to the Global Warming Potential (GWP). From a graphical representation it could be approximated that about 50% of the GWP is caused by the pulp and paper production.

4.4.3. Recycled carton board

Recycled carton board can serve different purposes. Depending on the purpose recycled carton board needs a certain quality. Newspapers for example require less quality than the recycled carton board used for inserts. Therefore paper is sorted and graded at collection sites to deliver the right quality of waste paper. The quality of paper is related to the length of the fibers, which will shorten each time the paper gets recycled. After a maximum of 6-7 times of recycling fibers eventually become too short for further recycling (Villanueva & Wenzel, 2007). When the waste paper arrives at the mill it is turned into a pulp. The paper is then screened, cleaned and de-inked through a number of processes until it is suitable for carton board making.

Using recycled material is considered to be a good environmental practice. Several studies indeed confirm (Finnveden & Ekvall, 1998; Byström & Lönnstedt, 2000) that waste paper pulping generally requires less energy per ton of pulp than pulping processes that use virgin fiber and saves the use of virgin fiber inputs. However, chemical pulping produces much of its energy through the burning of biomass. Moreover, it even produces a surplus of energy which is often sold to third parties. In contrast to chemical pulping of wood from virgin sources, waste paper pulping provides no wood wastes or dissolved chemicals for energy generation. As a consequence, increased waste paper utilization reduces the availability of biomass energy and increases reliance on purchased energy, which in many countries would be fossil fuels (Byström & Lönnstedt, 2000).

Furthermore, if the surplus of energy generated by the chemical pulping process would otherwise be produced by fossil fuels this would be disadvantageous for recycling paper.

Another negative effect of recycling is that the ability for energy recovery by burning paper in an incinerator is lost. Burning paper for energy production is also a renewable energy source.

If fossil fuels are the alternative energy source, incinerated paper replaces fossil fuels, and emissions of CO

2

can be decreased (Finnveden & Ekval, 1998).

The use of recycled fibers in paper production can be promoted with the aim of reducing

climate change, if the lower pulpwood demand leads to an increased production of fuel wood,

which is used to replace fossil fuels (Finnveden & Ekvall, 1998). The effect on forestry

however wasn’t included in their study. The system was expanded by Merrild, Damgaard,

Christensen (2008) to include forestry and to include fossil fuel energy substitution from

saved biomass. Expanding the system to include forestry was shown to have minor effect on

the result. But the inclusion of fossil fuel energy substitution, by energy produced from saved

biomass available due to recycling makes paper recycling superior to incineration in all cases

(Merrild et al., 2008).

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In several studies (Dias et al. 2004 & 2007; Mourad et al. 2008) recycled carton board was given credit for its positive effects on other stages in the supply chain. In the study of Mourad et al. (2008) it was found that a recycling rate of 30% reduces the GWP by 20% mainly caused by a big reduction of methane production during landfilling.

The importance of transportation in the overall environmental impact of the paper cycle is very small (Villanueva & Wenzel 2007). They reviewed several studies on the importance of transportation in the recycling business. In relation to the overall energy consumption Tillman et al. (1991) concluded that transportation contributed less than 2 % and according to Frees et al. (2005) only 0,4 %.

4.4.4. Carton board converting (A&R Carton)

A&R Carton converts the carton board into cartons. Large rolls of carton board are the inputs for the rotogravure printing press, which guides the carton board through several ink compartments in a row, each containing a different color. When the ink is placed on the carton board it needs to be dried immediately. This is done by heat systems that are located directly behind the ink compartments. Varnish will be added at the last stage to give the image a shiny look. After the image is printed the rolls are cut into plano’s and placed onto pellets. During this process, carton board waste is picked and guided to a pressing machine preparing it for transportation to the recycling company. The plano’s are transported to the folding gluing machines. Here the inserts are glued onto plano’s, if needed, and folded into cartons.

Figure 3 Production process

No life cycle studies could be found that included the converting stage in the life cycle and therefore no comparison could be made.

4.4.5. Additives and Packages

During the pulp and paper board manufacturing and the converting stage several additives are

added to the process. These additives are chemicals, ink, glue, etc. When the goods are

finished they are packaged and transported to the next stage. There will be no further

elaboration on the production processes of additives and packages as it doesn’t contribute to

the purpose of this study.

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4.4.6. Final disposal

In this study the final disposal of the used packages is included. Waste can be managed in many ways and certain strategies are preferred above others. The best way to deal with waste is to reduce the waste by source reduction or reusing the waste for other purposes (EPA, 2008). However, reducing and reusing waste is not sufficient to get rid of all the waste.

Therefore some other methods are used to treat the waste. The integrated waste management hierarchy in the USA includes furthermore the following components in order of preference:

recycling (including off-site composting), combusting with energy recovery and disposal through landfilling (EPA, 2008).

Recycling is seen as beneficial compared to the manufacturing from virgin inputs as it requires less energy and has other supply chain advantages. The second option is composting which does not result in CH

4

emissions as composting takes place in aerobic conditions.

When waste is combusted with energy recovery two GHG are emitted: CO

2

and N

2

O. Recovering energy from waste combustion can be beneficial to the environment when the alternative source for energy production would for example be coal, which produces huge amounts of CO

2

emissions.

Finally, the waste, in this case cartons, are landfilled. As cartons are organic materials some of this matter decomposes anaerobically and releases CH

4

. Because there would be no CH

4

emissions when carton would decay in a natural way, CH

4

emissions are seen as anthropogenic i.e. caused by human behavior. Food discards, yard trimmings, and paper are not completely decomposed by anaerobic bacteria, some of the carbon in these materials is stored in the landfill. Because this carbon storage would not normally occur under natural conditions (virtually all of the organic material would degrade to CO

2

, completing the photosynthesis/respiration cycle), this is considered an anthropogenic sink (EPA, 2006).

Landfilling of inorganic materials like metals and plastics does not result in CH

4

emissions or carbon storage.

The effect landfilling has on the environment depends heavily on the site the waste is landfilled in. CH

4

is a potential energy source and some landfill sites have technologies to turn this CH

₄

into electricity or fuel gas. Other landfill sites flare CH4 emissions emitting only CO

2

. Although energy generation is preferable, flaring transforms CH

4

emissions into CO

2

. Because CO

2

emissions contribute less to the GWP than CH

4

emissions the GWP is reduced.

In a study by Dias et al (2004) the final disposal phase contributed about 20% to the GWP

100

. In another study by Dias et al. (2007) it became clear that the contribution of the final disposal phase depends on where the waste is handled. When waste was collected in Germany, the final disposal phase contributed to approximately 15% of the total global warming potential.

Waste processed in Portugal however contributed to almost 50% to the GWP

100

as in Portugal

the main final disposal alternative is landfilling. In the study of Mourad et al. (2008)

landfilling contributed to 55% of the GWP assuming that 100% of the collected packages

were landfilled.

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H5 Theory

5.1 Carbon Footprint

The carbon footprint mentioned in the main question needs some explanation. The carbon footprint or Global Warming Potential (GWP) is a measure of the contribution to climate change over a certain time span, often 100 years, expressed in CO

2

-eq. Greenhouse gasses each contribute differently to the GWP. CH

₄

for example has an impact of 25 times the impact of CO

2

seen over a 100 years period. Therefore, GWP is expressed in equivalents, where each GHG converted to CO

2

emissions by multiplying it with their emission factor.

The emission factors are adopted from the IPCC (2007).

Figure 4 Global Warming Potentials, IPCC (2007)

In this report the GWP is calculated with a time span of 100 years (GWP

100

). Only non- renewable emissions are included in the GWP, such as the combustion of fossil fuels like oil, coal and gas or GHG emissions caused by chemical reactions. Just like sustainability, carbon footprint has not a single definition. Two definitions are used as example to show how a carbon footprint can be interpreted:

Product carbon footprint (Carbon Trust et al, 2008):

GHG emissions of a product across its life cycle. From raw materials through production (or service provision), distribution, consumer use and disposal/recycling

Carbon Footprint (CEPI, 2007):

A carbon (or climate or greenhouse gas emissions) footprint is a balance sheet of greenhouse gas emissions and removals (transfers to and from the atmosphere).

The PAS 2050 definition only includes GHG emissions whereas the Confederation of European Paper Industries (CEPI) also includes removals. Furthermore, CEPI mention that in some cases offsets are also allowed, i.e. removals accomplished outside the boundaries of the analysis but “owned” by the reporting entity. Moreover, avoided emissions, emissions that do not occur because a product or process makes other supply chain activities redundant, can be taken into account.

The outcome of a carbon footprint will depend heavily on what a carbon footprint is

considered to be. Focusing only on emissions will create a bigger carbon footprint than when

removals are included. When the goal is to identify product or process improvements only

emissions should be considered. When the goal is to compare products, or make investments

decisions avoided emissions are included as well.

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5.2 Life Cycle Assessment

A company which has the aim to operate in a sustainable manner needs to consider whole product chain, and not just those links which belong to its own sphere of legal responsibility.

The holistic system’s perspective, which is applied in life cycle assessment, enables the company to disclose the problem shifting which occurs when solutions to environmental problems at one place in a product’s life cycle create new problems elsewhere in the life cycle. This characteristic makes LCA a valuable decision support tool in companies which aim at developing their activities in a sustainable direction (Hauschild et al. 2005).

Life cycle assessment is a “cradle-to-grave” approach for assessing product systems. “Cradle- to-grave” begins with the gathering of raw materials from the earth to create the product and ends at the point when all materials are returned to the earth. LCA evaluates all stages of a product’s life from the perspective that they are interdependent, meaning that one operation leads to the next.

Although LCA is often related to environmental impacts, it can potentially also include social and economic aspects often called Social LCA (SLCA) and Life Cycle Costing (LCC). As is proposed by Klöpffer (2008) measuring sustainability from a life cycle perspective would be the sum of LCA, SLCA and LCC. LCA promotes the following (UNEP-SETAC, 2004):

Awareness that our selections are not isolated; making choices for the longer term; improving entire systems, not single parts of systems; informed selections.

LCA can deliver a couple of benefits for A&R Carton (PAS 2050, European platform of LCA, Baumann & Tillman, 2002):

Decision making

- Evaluation of alternative product configurations, operational and sourcing options, etc.

on the basis of their environmental impact.

- Policy making and use as instruments of control Learning

- Internal assessment of product life cycle impacts.

- A benchmark for measuring and communicating impacts reductions.

- Identification of improvement possibilities.

- Selection of environmental performance indicators.

- Comparison of product impacts between products and the products of competitors.

Market claims

- Communicate the environmental performance of products or services, through the use of environmental labels and product declarations.

³

Supporting

- Corporate responsibility reporting

- Methodologies of tools aimed at developing greener products 5.2.1 LCA Method

3 http://lca.jrc.ec.europa.eu/lcainfohub/applications.vm

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The LCA process is a systematic, phased approach and consists of four components: goal definition and scoping, inventory analysis, impact assessment, and interpretation as illustrated in figure 1. The systematic approach was developed by ISO and is the most common approach for conducting an LCA study.

Figure 5: Phases and implications of an LCA adopted from Rebitzer et al. (2004)

5.2.1. Goal Definition and Scoping

In this phase the goals of the study are determined and the object of the study is chosen i.e.

the functional unit to which the impacts are related to. The choice of the goal of the study will have impact on the methodological choices that can be taken during the LCA. Two main goals can be identified (Jorgensen et al., 2008). One is product, process or company comparison, herein lie also labeling and social investments. The other class is identification of product or process improvements. System boundary decisions are needed to limit the study and to make the processes transparent that are included in the study. Within these system boundaries cut-off criteria are set to make the study more practicable.

5.2.2 Inventory Analysis

Identify and quantify energy, water and materials usage and environmental releases (e.g., air emissions, solid waste disposal, waste water discharges) of the processes within the system boundaries.

5.2.3. Impact Assessment

Assess the potential human and ecological effects of energy, water, and material usage and the environmental releases identified in the inventory analysis. In the impact assessment step, the LCA attributes emissions to several impact categories, such as climate change, stratospheric ozone depletion, tropospheric ozone (smog) creation, eutrophication, acidification, toxicological stress on human health etc. Which impact categories are included in the study is up to the researcher. As is shown in the appendix 1 there is not yet a consensus on impact categories.

These impact categories are typical midpoint level impact categories. Endpoint level impacts do also exist. They are called the areas of protection: human health, natural environment, natural resources and man-made environment. In principle, LCA attempts to model any impact from the product system which can be expected to damage one or more areas of protection (Hauschild et al., 2005). The midpoint impact categories have a casual relationship with the end point levels, but most of the time these relationship is deemed too uncertain.

Therefore, LCA results are often presented at midpoint levels.

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The impact assessment proceeds through four steps.

1 Classification is the first step, where categories of environmental impact relevant to the study are defined. Emissions that have been assessed during the inventory analysis are assigned to the environmental impact categories.

2 The next step, characterization, is closely linked to classification. Different emissions that are assigned to the impact categories all get a weighting score according to their contribution to a common unit. The common unit can be the global warming potential expressed in kg CO

2

-equivalents.

3 To be able to compare the different impact categories a normalization step is introduced.

Normalization expresses the magnitude of the impact scores on a scale which is common to all the categories of impact.

4 The fourth and final step of the impact assessment is valuation where a ranking or weighting is performed of the different environmental impact categories and resource consumptions. The valuation is needed when trade off situation occur as describer under normalization (Hauschild et al., 2005).

According to the ISO standard the first two steps of the impact assessment are mandatory while normalization and valuation are optional (Hauschild et al., 2005).

5.2.4. Interpretation - Evaluate the results of the inventory analysis and impact assessment to select the preferred product, process or service with a clear understanding of the uncertainty and the assumptions used to generate the results.

Although ISO is the originator of the framework it refrains from a standardization of detailed

methodological choices (Hauschild et al., 2005) which are important for the outcome of the

study. Especially the system boundaries and what processes to include within these

boundaries are often decisive for the result of an LCA study (Rebitzer et al., 2004). To help

making these choices researchers and institutions developed guidelines to make LCA more

coherent amongst different studies.

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5.2.2 Methodological Frameworks

One institution that focuses on the ability to compare LCA studies is the EPD. EPD stands for Environmental Product Declaration. An important aspect of the international EPD system is that it offers generally accepted programme requirements, building on common and recognised LCA calculation rules for as many product categories as possible, as well as to provide a uniform reporting format (EPD, 2008). The EPD offers guidelines for conducting an LCA. Within these broadly defined guidelines as to what to include in a study and how to calculate certain emissions, the researcher still needs to make product specific choices called product category rules (PCR’s). These PCR’s are a set of specific rules, requirements and guidelines for developing environmental declarations for one or more groups or products that can fulfil equivalent functions (Carbon Trust et al., 2008). In order to get a unified way of conducting an LCA within product groups, companies that conducted an LCA study can make their study standard for the whole product group. This means that if a carton board company Y got approval of their product category rules (PCR) applied in their LCA study these same rules will apply for carton board company Z, if they want to publish an environmental product declaration. In this way, products in the same product category can be compared 1 on 1, furthermore making an LCA less time consuming for other companies. After all, important and difficult decisions like boundary setting are already made.

In 2008 the Carbon Trust et al. developed a standard work for assessing a carbon footprint called the PAS 2050. This guideline describes about the same content as the EPD guidelines and is therefore useful for comparison. It is useful to know what the differences are between these two guidelines, on which points they are the same and where they complement each other. Although the PAS 2050 provides a complete guide for companies to assess the life cycle carbon footprint still specific product category rules need to be chosen.

Instead of letting companies begin from scratch CEPI (2007) published a structured framework (“ten toes”) for the development of a carbon footprint for paper and board industries in which product category rules are included. In each step different calculation approaches are provided from which the researcher can choose the most appropriate.

5.2.3 Accounting

Besides the importance of boundary settings and allocation procedures it is important that the numbers are presented in a way that is most useful. The GHG-protocol has made important contributions to help companies prepare a GHG inventory that represents a true and fair account of their emissions. Through the use of standardized approaches and principles it increases consistency and transparency in GHG accounting and reporting among various companies and GHG programs (WBCSD & WRI, 2004). The GHG-protocol divides CO

2

emissions into three different scopes: scope 1, scope 2 and scope 3.

As the GHG-protocol is the guiding accounting and reporting instrument for GHG it will be

used in this study following the example of CEPI, who included the scopes in their

framework. In the GHG-protocol the scopes are used for company systems instead of product

systems but a simple change in the text will make it applicable for the LCA study. Company

emissions will be read as functional unit.

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Direct GHG emissions occur from sources that are owned or controlled by the company, for example, emissions from combustion in owned or controlled boilers, furnaces, vehicles, etc.;

emissions from chemical production in owned or controlled process equipment. When electricity is used no emissions occur at the production site. However, electricity needs to be generated somewhere. When electricity is generated by coal, for example, there is a huge amount of CO

2

emission. These emissions are situated under scope 2 and are called indirect emissions. The amount of CO

2

indirectly emitted by the use of electricity is strongly related to the way the electricity is produced. Only fuels will emit CO

₂

. Wind, nuclear and hydro power will have no CO

2

emissions and are therefore environmental friendly sources if the focus is on global warming. Of course nuclear energy has some other negative effects but these will be out of the scope of this research.

Scope 3 is an optional reporting category including all other indirect emissions. Scope 3 emissions are a consequence of the making of the functional unit, but occur from sources not owned or controlled by the company. Some examples of scope 3 activities are extraction and production of purchased materials; transportation of purchased fuels; and use of sold products and services, external transport.

Figure 6. Overview of scopes and emissions across the value chain, adopted from GHG-protocol (2004)

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5.3 Social LCA

In relation to sustainable development researchers show increasing interest for the inclusion of social aspects into the environmental life cycle assessment of products and systems in recent years (Jorgensen, 2008). A feasibility study was conducted by the UNEP/SETAC Taskforce to see if social aspects can be integrated into the LCA framework. According to this taskforce there were no fundamental problems calling the feasibility of SLCA into question (Griesshammer et al., 2006). The so called Social Life Cycle Assessment (SLCA) uses the same methodology as the LCA: goal definition and scope definition; inventory analysis; impact assessment and interpretation of results and evaluation. SLCA is the next step in the direction of mapping the full spectrum of sustainability. However, there are some difficulties specific to social aspects that need to be overcome. These will be discussed in the following steps.

5.3.1 Goal and Scope

The first step can be conducted in nearly the same way as in the LCA. The same goals can be set and boundary setting can be applied. But seeing as SLCA is in its infancy no decision is yet made about which indicators or impact categories to include. There is a wide variety of social indicators to choose from. For example, the Öko-institute collected about 3500 indicators from key documents like: OECD guidelines, GRI, the SA 8000, the ILO conventions and many other proposals (Griesshammer et al., 2006). Some indicators are:

accidents, diseases, child labor, discrimination, number of trainees etc. The indicator set for SLCA needs to cover both negative and positive effects. For example: providing education for the employees enhances one’s knowledge and certain attributes of a product can give positive effects to the customer.

The social effects of the use phase of products are the most challenging (Schmidt et al., 2004).

This is because different assessment criteria are needed, depending on the product’s specific purpose and characteristics, its users and circumstances of usage. For example, the cartons are easier to carry when compared to plastic crates. Also, beer bottles in cartons can be placed easier in the refrigerator compared the plastic crates. However, these advantages will not be fully exploited when the circumstances of use change. For example, on festivals beer is not necessarily placed in refrigerators and large amounts of beer are transported by car. Instead, other features become more important such as the possibility to stack the beer to use less space. No systematic gathering of information about the users phase and relating them to the functional unit exists.

Also, it is argued by several researchers that the causal relationship is not the process to social impact but from the conduct of the company to the social impact (Jorgensen et al., 2008). This means that data should be gathered on company level and an extra step needs to be taken to allocate these impacts to the product. This is where the first problem appears with SLCA. The first question is how to quantitatively relate the indicators to the functional unit of the system.

A proposal was made (Jorgensen et al. 2008) that the share factor or allocation principle could be based on value creation or number of labor hours spent.

In a traditional LCA the whole life cycle of a product is included, as each chain could

potentially have a big contribution to the chosen impact categories. However, there are some

difficulties in finding applicable data for an SLCA study. To make an SLCA study easier,

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Dreyer et al. (2006) suggest to only take into account those parts of the supply chain which can be influenced by the company.

5.3.2 Inventory analysis:

The difficulty in data gathering for SLCA entails the fact that generic data are less useful.

Acknowledging that social impact is related to the conduct of the company and not to the processes needed for producing, the product can give different social impact results for companies in the same sector. Also not all data are relevant in each economic, social and political environment. As Griesshammer et al. (2006) explain, indicators like the length of the annually paid holiday are important in developed countries while child labor and human rights abuses are taken for granted. The data collections of the indicators are categorized in stakeholder categories. The UNEP-SETAC taskforce, a group for coordinating SLCA, agreed on a minimal list of main stakeholders categories, including: Workers; local community;

consumers (related only to use stage); society (national and/or global) and organization (UNEP-SETAC, 2008).

5.3.3 Impact assessment:

Classification:

Just like LCA there is no definitive list of social impact categories. The Global Reporting Initiative (GRI) can be used as an example for impact categories: labor practices and decent work, human rights, society and product responsibility. The UNEP/SETAC task force proposed the following impact categories that need further elaboration: equal opportunities, workers rights and working conditions, respect of national and international laws, human rights, consumer protection (Griesshammer et al., 2006).

Characterization:

The second main problem appears in the characterization phase. Indicators can’t be simply added or aggregated (Griesshammer et al., 2006). For example, what effect does child labor have on the impact category workers? Are wages more important than health and safety?

What does promoting social responsibility say about a company’s organization compared to corruption within an organization? There is presently no consensus regarding the cause-effect relationship of indicators to impact categories.

Normalization and valuation:

In this step, the results of the impact categories must be normalized to one measure in order to compare the different impacts with each other. In the normalization step, these impacts would be placed in relation to a comparable statistical universe, such as the overall unemployment figures in Germany and the overall CO

2

emissions of Germany (Griesshammer et al. 2006).

Jorgensen et al. (2008) conclude that very little work has been done on these elements of the SLCA.

5.3.4. Interpretation

The interpretation phase can be dealt with similarly to LCA studies.

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5.3.5. Conclusion

SLCA is not yet fully developed. Some problems within the SLCA method need to be dealt

with. A taskforce was appointed by the UNEP-SETAC Life Cycle Initiative to coordinate the

course of SLCA and to develop a “Code of Practice”. This CoP should be finished in April

2009 and will be the first international reference document on the subject of social LCA.

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H6 LCA Study

6.1 Goal and scope definition 6.1.1 Goal

The first step of the LCA is to set the goals of the study. These goals are already explained in the research design section but will be summarized here. Furthermore the goals are made more specific.

- Perform a thorough study in order to deliver a standard way of assessing the impact of making cartons that can be used as a guideline for the A&R Carton Group.

- To assess the potential environmental impact of cartons in the form of global warming potential over 100 years, over its entire life cycle in order to identify the processes with the largest environmental impacts.

- Create and compare different carbon footprints using data on carton board production from the three main suppliers of carton board.

- To make a benchmark, try to find carbon footprints of competitors in the carton branch and/or carbon footprints of products that can be used as substitutes for cartons, like plastic crates.

6.1.2 Functional unit

The product under study is the Heineken USA 6-pack. There are several reasons why the Heineken USA 6-pack is chosen. First of all, Heineken USA 6-packs are produced in the biggest amounts. In 2007, 66,3 million Heineken USA 6-packs were produced out of a total 210 million cartons. Secondly, 6-packs have relative stable distribution channels and suppliers. Thirdly, the production process is fairly stable, which will improve the quality of the LCA.

The functional unit is the reference unit used to quantify the performance of a product system.

In this study, the functional unit is defined as 1 million cartons carrying six 355 ml bottles that are consumed in the USA.

6.1.3 System boundaries

It is important to set system boundaries in an LCA study. There are many processes that could be included in an LCA. The more is included the more complex the study will become. A summary of what is inside the boundaries of the study is given below.

Included:

- First tier suppliers of raw materials to the main supply chain are included in the study.

- The materials used during the manufacturing of cartons are included in the study.

In addition, the production of packages and trays is included.

“Care for the Future”

Measuring the Sustainability of Products

A&R Carton